South-Western Federal Taxation 2019: Individual Income Taxes (Intuit ProConnect Tax Online 2017 & RIA Checkpoint 1 term (6 months) Printed Access Card)
42nd Edition
ISBN: 9781337702546
Author: James C. Young, William H. Hoffman, William A. Raabe, David M. Maloney, Annette Nellen
Publisher: Cengage Learning
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Question
Chapter 4, Problem 49P
To determine
Identify the tax consequences of the interest free loans lend by Person R.
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Ridge is a generous individual. During the year, she made interest-free loans to various family members when the Federal interest rate was
3%. What are the Federal tax consequences in 2018 of the following loans by Ridge?
If an amount is zero, enter "0".
a. On June 30, Ridge loaned $12,000 to a cousin, Jim, to buy a used truck. Jim's only source of income was his wages on various
construction jobs during the year.
The computed imputed interest amount for 2018 is $
However,
This is because the loan was less
than
and
does not have any investment income.
b. On August 1, Ridge loaned $8,000 to a niece, Sonja. The loan was meant to enable Sonja to pay her college tuition. Sonja reported
$1,200 interest income from CDs that her parents had given her.
c. On September 1, Ridge loaned $25,000 to a brother, Al, to start a business. Al reported only $220 of dividends and interest for the year.
The computed imputed interest amount for 2018 is $
Because this amount
However,
exceed $1,000,
is…
R and J were married in 2007. They have a five year old child and a son born December 16, 2018. R’s 67 year old father lived in a nursing home until his death on March 4, 2018. R and J provided all of his support until his death. R earned $43,000 in salary during the year. They also had $2,100 in interest from the credit union. They incurred $7,800 in itemized deductions during the year. Compute their taxable income and their tax for 2018.
(a) In 2010 Jim loaned Patti $4,500, as a personal loan. In 2014 (when the outstanding loan
is still $4,500), Patti informs Jim that she will not be able to repay the loan. In 2014, Jim
has $1,000 short-term capital gain and $40,000 wage income. In 2015, Patti repays the
$4,500. How much, if any, of that does Jim have to include in his income for 2015?
(b) Suppose, instead, that the loan in part (a) was a business loan. How much, if any, of the
2015 repayment does Jim need to include in his income?
Chapter 4 Solutions
South-Western Federal Taxation 2019: Individual Income Taxes (Intuit ProConnect Tax Online 2017 & RIA Checkpoint 1 term (6 months) Printed Access Card)
Ch. 4 - According to the Supreme Court, would it be good...Ch. 4 - Prob. 2DQCh. 4 - Prob. 3DQCh. 4 - Ben lost his job when his employer moved its...Ch. 4 - Prob. 5DQCh. 4 - Prob. 6DQCh. 4 - Prob. 7DQCh. 4 - A Series EE U.S. government savings bond accrues...Ch. 4 - The taxpayer performs services with payment due...Ch. 4 - Prob. 10DQ
Ch. 4 - Wade paid 7,000 for an automobile that needed...Ch. 4 - Prob. 12DQCh. 4 - Prob. 13DQCh. 4 - A divorce agreement entered into in 2017 requires...Ch. 4 - Prob. 15DQCh. 4 - Prob. 16DQCh. 4 - Prob. 17DQCh. 4 - Prob. 18DQCh. 4 - Prob. 19DQCh. 4 - Prob. 20DQCh. 4 - Prob. 21CECh. 4 - Bigham Corporation, an accrual basis calendar year...Ch. 4 - LO.3 Simba and Zola are married but file separate...Ch. 4 - Casper and Cecile divorced in 2018. As part of the...Ch. 4 - Prob. 25CECh. 4 - Prob. 26CECh. 4 - Prob. 27CECh. 4 - Prob. 28PCh. 4 - Prob. 29PCh. 4 - Determine the taxpayers gross income for tax...Ch. 4 - Prob. 31PCh. 4 - Determine the taxpayers gross income for tax...Ch. 4 - Prob. 33PCh. 4 - Your client is a partnership, ARP Associates,...Ch. 4 - Prob. 35PCh. 4 - Prob. 36PCh. 4 - Prob. 37PCh. 4 - Prob. 38PCh. 4 - Prob. 39PCh. 4 - Prob. 40PCh. 4 - Prob. 41PCh. 4 - Prob. 42PCh. 4 - Prob. 43PCh. 4 - Prob. 44PCh. 4 - Prob. 45PCh. 4 - Prob. 46PCh. 4 - Prob. 47PCh. 4 - Prob. 48PCh. 4 - Prob. 49PCh. 4 - Prob. 50PCh. 4 - Prob. 51PCh. 4 - Prob. 52PCh. 4 - For each of the following, determine the amount...Ch. 4 - Prob. 54PCh. 4 - Prob. 55PCh. 4 - Prob. 56PCh. 4 - Prob. 57PCh. 4 - Donna does not think she has an income tax problem...Ch. 4 - Prob. 1RPCh. 4 - Prob. 2RPCh. 4 - Prob. 3RPCh. 4 - Prob. 1CPACh. 4 - Fred and Wilma were divorced in year 1 (before...Ch. 4 - Bill and Jane Jones were divorced on January 1,...Ch. 4 - Jake pays the following amounts to his former...Ch. 4 - Mary purchased an annuity that pays her 500 per...
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